Investing in property is one of the smartest financial decisions. 2020 has been a defining year for all industries. Currently, we are seeing a price range resembling that of 2012-13. Therefore, we can expect a price boom within the next few years. And as John Templeton famously said, the time of maximum pessimism is the best time to buy.
That said, according to Property Monitor, over 6,200 apartments and over 800 villas/townhouses were handed over in Dubai during Q1 2020. This is probably the best time to make a purchase in the property market. With the fall in prices within budget for most, the long-term UAE residency visa schemes and the 15 zones that have opened up to foreign buyers, these factors are expected to act as a tailwind for the real estate market hereon.
Now if you are looking to make a profitable investment during this period, establish the following key factors before deciding on a property option.
To help determine your end goal, you have to decide which aspect you are looking to gain the most from; yield, capital appreciation, or a good mix of both.
Yield is the amount of annual return you are likely to get on your investment. It is calculated by expressing a year’s rental income as a percentage of how much the property cost.
To find the best property that generates a higher yield, you must compare different properties in the immediate vicinity within a specific location. It is important to be specific as property from location A and property from location B will not have similar foundations to be pitted against one another. To exemplify, a property in Downtown and property in JLT will not have similar yield, as there are a number of different factors influencing each area.
Capital Appreciation is the increase in the value of an investment. It is the difference between the purchase price and the sale price of a property. Here, too, to find the best-suited property for a higher capital appreciation, it is imperative to compare properties within locations, instead of two different properties in dissimilar locations.
To find a property that gives you a good mix of the two, there are specific factors to look into when determining this type of property.
In Dubai, you have a variety of different types of locations to choose from. Ranging from beachfront homes and marina apartments to golf course villas and midtown skyscrapers, you can have it all. Some of the popular investment properties are located in Dubai Marina, Downtown, Palm Jumeirah, Emirates Living, Dubai Hills Estate, Damac Hills, and Blue Waters.
Stress on the importance of identifying individual investments that are located immediately within the vicinity in one location. Otherwise, it’s like comparing apples and oranges, with no fruitful results.
One of the most important factors to get the best deal is the motivation of your seller. If they are highly motivated, you are likely to get your investment within your budget.
However, we understand that this is a tedious process, and is not ideal for everyone to check all the boxes. This is why you can hire the expert services of Provident. We are your one-stop-shop for all things real estate. Our expert consultants will take you through the best options in town and get you deals that are profitable and meet your long term goals. Get in touch with us to know more about the best investment opportunities in Dubai!
For more information, get in touch with us at Provident